May 21, 2009

Constructive criticism goes far beyond the crass insults so prevalent in today’s media. Here’s how to make the most of it.

We live in an age where the line between criticism and nastiness has blurred. I’m not sure how this happened or when it began, but there are signs of it everywhere, especially on the Internet and in the media.

The Internet offers anonymity, distance, and the ability to say pretty much whatever we want about people. Nastiness masked as criticism is a staple of television and radio, whether it’s Gordon Ramsay hurling invective at restaurant workers on his Kitchen Nightmares show, Simon Cowell coming up with ever more creative ways of informing American Idol contestants that they have no talent, or talk show hosts making snide comments about a politician’s appearance. Our appetite for seeing other people criticized appears to know no bounds.

I’m sure you’ve personally encountered this kind of behavior. You’ve probably had a boss or colleague who took perverse pride in reminding you of your shortcomings. Maybe you yourself have been guilty of treating someone this way. How we give and receive criticism speaks volumes about our character, so this column is an appropriate venue for considering better and worse ways of criticizing people and how we ought to respond when someone finds fault with our own work.

What Is Criticism, Anyway?

Being taken to task for something we’ve said or done suggests that we’re fallible, and who wants to admit that he or she is flawed? If we don’t have high self-esteem, criticism validates our already low opinion of ourselves. If we’re strong and self-confident, criticism might surprise us with an unflattering view of ourselves. Regardless of how one feels about oneself, it seems criticism is something that any reasonable person wishes to avoid.

However the goal of true criticism is to help someone be the best they can be. It is not about making someone feel bad, instilling guilt, or reducing a person to tears, though all of these can be an unfortunate byproduct. When criticism is done appropriately, the person who has been criticized will understand what he or she has done wrong and will feel inspired to make a change for the better. Not only should we not avoid being criticized, we should embrace criticism because it is the only way we can continue to grow professionally and personally.

Criticism Should Recognize the Good in Others

Think about the full, rich life you’ve led thus far. You have enjoyed many professional and personal successes. You have been kind and generous to people. You have done lots of wonderful things that make it easy to like what you see when you look in the mirror.

Now think about some of the less noble choices you’ve made. You’ve cheated. You’ve lied. You intentionally hurt someone’s feelings and refused to apologize. In other words, you have been—on occasion—all too human. We all have. Wouldn’t it be unfair for you to be reduced to nothing more than the sum of your poor choices? Wouldn’t you resent having your many praiseworthy actions forgotten about when someone is troubled by something you’ve done? Of course you would, and you would be justified in feeling this way. Anyone who has lived beyond the age of three or four will have tallied up at least a few disgraceful decisions, but to be seen as nothing more than those bad decisions just isn’t right.

Criticism should include an acknowledgment of what the other person has done well, as well as an account of what he or she has not.

Criticism Should Not Be Personal

It’s easy to criticize the person rather than his or her ideas, but just because we can do something doesn’t mean that we should. The Internet in particular is rife with personal attacks posing as criticism. For example, a person identifying himself as “peter” responded to my column on the ethics of office gambling by posting: “Shut up, you’re such a baby!” Grammatical problems aside, “peter” said nothing at all about the point I was making.

Responding to the same column, “cp” wrote:

I really can’t believe this guy has a PhD and is wasting his time writing a column like this. I guess a PhD makes him smarter than me and I really didn’t know until a smart person like him pointed this out to me. Sounds to me someone needs to go out and make some friends to learn what it is like to be a NORMAL person.

Well, I may have been completely mistaken in arguing against betting at the office, but both “peter” and “cp” missed an opportunity to explain why this was so.

The only meaningful criticism about a person’s ideas focuses on the soundness or validity of that person’s argument rather than his or her personal characteristics. This means we must consider the truth of the claims in the argument and whether the conclusion logically follows from the premise. Anything else isn’t criticism at all, but merely an attempt by the critic to blow off steam, get some attention, transfer his or her frustrations to someone else, or any number of other irrelevant issues.

Why It’s in Our Own Interest to Acknowledge Criticism

What should we do when someone criticizes us? As long as the criticism isn’t petty, vicious, personal, or otherwise way off base, we should take it to heart. It’s only by carefully considering what a critic has to say that we’re able to become better. Of course it’s hard to do this, since we need to have both self-confidence and humility to acknowledge that we may be misguided. It’s understandable that our first reaction to criticism is a refusal to consider the critic’s points. Nevertheless even the most expert among us can have room for improvement. We can’t maintain excellence or hope to improve if we refuse to work on ourselves, which means, in part, taking criticism seriously.

The Rules of Fair Play

When you want to criticize someone:

1. Begin by finding something you like or appreciate about the person you’re about to criticize. This is not only fair, but will also make the person more likely to be receptive to what you have to say.

2. Focus on what that person has said or done, not on him or her personally. Only the former is relevant and likely to be acknowledged.

3. Conclude by affirming your faith that the other person will consider what you have to say. This is both a respectful way to wrap up the criticism and the best way to ensure that your remarks will be given their due.

When someone criticizes you:

1. Resist the urge to dismiss the critic. Considering what the person has to say will only strengthen your own understanding of the issue you care about.

2. Recognize that you may not be right. You may be unaware of one or more of the facts relevant to your argument, or you may have ignored some of the rules or principles at stake.

3. Realize that ad hominem attacks say more about the person making them than about you. Rather than sink to the level of such attacks, it’s wise to ignore them.

Our goal in life can be to bring out the best in others and ourselves, or it can be to puff up our own egos and debase others by exploiting our power over them. If the former is our mission, we would do well to give criticism respectfully and receive it graciously whenever it is offered in good faith.

Weinstein is the corporate consultant, author, and public speaker known as The Ethics Guy. He has appeared on numerous national TV shows and is the author of several books on ethics. His Ask the Ethics Guy! column appears every other week on BusinessWeek.com’s Managing channel.

Worth Rises, Falls ‘With Markets and Attitudes And With Feelings, Even My Own Feeling’

It’s one of the great mysteries of the business world: How much is Donald Trump really worth?

The world famous real-estate developer and television personality has consistently said it’s in the billions. A 2005 book citing anonymous sources said it was between $150 million and $250 million. Mr. Trump sued the writer for defamation. He alleged damage to his reputation that caused him to lose out on future deals in locales from Philadelphia to Kiev.

A hearing in that case will take place Monday in a state court in Camden, N.J. As part of the proceedings, the Donald, as he’s known to fans and detractors alike, has provided under oath the secrets to how he values his wealth and treasure. In one case, he says, he does “mental projections.”

“My net worth fluctuates, and it goes up and down with markets and with attitudes and with feelings, even my own feeling,” he told lawyers in the December 2007 deposition.

The deposition, marked “Confidential,” comes to light at a time when some of Mr. Trump’s projects, including several condominium developments that bear his name, are struggling. Among the problems are anemic sales, lawsuits, sharp declines in value and troubles with creditors.

In a telephone interview Sunday, Mr. Trump disputed that these are tough times for him. “We have a lot of cash right now. We’re starting to buy things,” he said while taking a break from playing golf at a Trump course in Bedminster, N.J. He said he stood by the statements he made in the deposition.

In the deposition, given to lawyers representing the book’s author, Timothy O’Brien, and its publisher, a unit of French-based Lagardere SCA, Mr. Trump described his public persona. “I’m not different from a politician running for office,” he said.

In the deposition, Mr. Trump said that his 2007 estimate of his net worth — over $4 billion — is “a very conservative number, in my opinion.” He also said $6 billion is a good number, counting his brand value. (In the interview Sunday, he said he was worth $5 billion, not counting brand value.)

Mr. Trump was asked whether he has ever exaggerated in statements about his properties. “I think everybody does,” he said in the deposition. “Who wouldn’t?”

A follow-up question: Does that mean he inflates the value of his properties in general, nonfinancial public statements? “Not beyond reason,” he said in the testimony.

The deposition reveals he told his bankers and New Jersey casino authorities in 2004 and 2005 that he was worth approximately $3.6 billion. In 2005, Deutsche Bank evaluated his net worth as part of underwriting a $640 million construction loan it made to Mr. Trump’s Chicago condo and hotel project. The bank said his worth was $788 million, according to information presented by the author’s lawyers present during Mr. Trump’s deposition.

In his testimony, Mr. Trump discounted that and other low-ball evaluations as “ridiculous.” And he noted, “They [Deutsche Bank] still come up with numbers that are many times” what the book’s author, Mr. O’Brien, reported. In his interview Sunday, he said Deutsche Bank looked at some of his assets, not all of them, and didn’t do independent appraisals. A Deutsche Bank spokesman couldn’t be reached.

Mr. Trump said Sunday that Mr. O’Brien, author of “TrumpNation: The Art of Being the Donald,” will “wish he never heard of that God damn book” and predicted that “the publishing company will pay me hundreds of millions of dollars” as a result of the suit.

Mr. O’Brien, who is an editor at the New York Times, declined to comment through his attorney, citing the ongoing litigation.

In the deposition, Mr. Trump discussed how he determined the value of a residential development on old rail yards on Manhattan’s west side. According to the deposition, when a newsletter reporter writing about the project’s 2005 sale for $1.8 billion said Mr. Trump had a “small interest,” Mr. Trump wrote him a note. “You’re a real loser. Thanks for the nice story. Is 50% small?”

But Mr. Trump had a 30% limited-partnership interest in the project, according to legal documents. A group of Hong Kong investors were the owners. Asked about this during the deposition, Mr. Trump explained that, in his eyes, he owned half because he gets paid fees for managing the buildings and because he didn’t have to put up cash in the deal. “In my own mind I’ve always felt that,” he said. “That 30% is equated to 50%,” he said. In his interview Sunday, Mr. Trump said he had owned the equivalent of “more than 50%.”

Mr. Trump often licenses his name to other developers in return for a fee or a cut of the sales. During the deposition, Mr. O’Brien’s lawyer, Andrew Ceresney, noted that Mr. Trump had claimed publicly that he had a major ownership in one such project.

For example, in a November 2007 Wall Street Journal interview cited by Mr. Ceresney, Mr. Trump said he had sold out units at an eponymous condo-hotel project in Hawaii. “The building is largely owned by me,” he said in the interview. But in the deposition, Mr. Ceresney produced the licensing agreement for the project. Mr. Trump wasn’t a major equity holder in the project, it showed, a fact Mr. Trump didn’t dispute.

“Because this is such a strong licensing agreement that I consider it to be a form of ownership,” Mr. Trump said. “I’d rather have this than own the building,” he said. Moments later he said: “I would say that it could be interpreted to be a form of ownership in the building.”

In the deposition, Mr. Trump is asked about the Bedminster, N.J. golf course, which financial statements showed had a net loss of $4.6 million in 2005. Has he ever done a financial analysis of his investment there?

“Yes, I’ve done mental projections,” he said, figuring he’d eventually make $120 million. He never put them down on paper. “You don’t really have to,” he said. Mr. Ceresney, asks: “Have you discounted in your mind for the risk that you won’t sell [memberships] at the prices you are anticipating?”

“I think I will, but it’s possible I won’t. But I think I will,” Mr. Trump said.

At one point during the deposition, Mr. Trump explained the importance of putting his projects in the best light possible. “Would you like me to say, oh, gee, the building is not doing well, blah, blah, blah, come by, the building — nobody talks that way. Who would ever talk that way?”

May 20, 2009

The good news is: budgeting is no rocket science. Here are 6 quickie tips to help you budget and plan your way to financial freedom:

Track Your Expenses – Keep a detailed recording of everything you spent on. By the end of the month, total up the various categories of spending. You’ll be amazed how much you actually spent on the unnecessary items.

Overestimate Expenses – Always overestimate rather than underestimate so that you don’t get caught off guard. This is especially true when budgeting for planned expenses.

Be Accurate & Organized – Don’t make wild guesses. If you’re not sure how much you spent on your favourite Starbucks Iced Caffe Latte, dig out its receipt to confirm the amount. By the end of each month, you’d want to know how much you end of spending and how much money was actually put aside into savings.

Regular Reviews – Ideally, reviews of your budget should be done on a monthly basis. You’ll need to decide how much time you need to spend in order to go through reviews of your bank account balances, expenditure records to gauge your spending patterns as well as evaluating whether you’re on or off track to achieving your overall financial goal.

Shopping KPIs – Set your own Key Performance Index (KPI) even when it comes to shopping. Make a list of what you need (be sure to do your stock takes first) and stick to that list. Conduct your own price checks and record down which place offers you the lowest price for a particular item. Never buy on impulse as it can break your budget.

Economical Options – Instead of spending your weekends at shopping malls, you may want to opt for a change in lifestyle that is healthier and more beneficial to your pocket. Try packing your own food and go for picnics to enjoy more quality time with your loved ones or give up memberships at an exclusive club house or gym and run that extra mile around a park. You might be able to add RM100 or more to your savings plan.